Delta To Defer More Jet Orders Than Expected

ATLANTA — Delta Air Lines Inc. said Friday it will defer $1.8 billion in orders for 35 new aircraft from Boeing Co. and McDonnell Douglas Corp., or $500 million more than it forecast in December.

And for the first time, Delta said some of the deferrals will involve firm orders in addition to options.

"The financial troubles of the airline industry show no sign of abatement as overcapacity prevails," said Ronald W. Allen, Delta's chairman.

The $1.8 billion in deferrals comes on top of a plan announced last April to cut capital spending $5 billion, partly through canceling or deferring orders for 100 aircraft. That plan, Monroe said, involved optional orders.

Some Delta orders appear slated for cancellation rather than just deferral. "There are some firm orders that will not be taken," said Delta spokesman Neil Monroe. He declined to elaborate. Both U.S. planemakers said no firm orders had yet been canceled.

About 20 percent of the $1.8 billion in deferred purchases is still subject to negotiation, the airline said. Monroe said he expected the talks to last at least another week. He declined to be more specific.

At Boeing, Delta has placed firm orders for 76 aircraft, including 57 737-300s, eight 757-200s, six 767s and five extended-range versions of the 767, the airline said. Delta has another 105 aircraft on optional order at Boeing.

Boeing spokesman John Wheeler said Delta has not canceled any outstanding orders. Instead, the company is stretching out its delivery schedule to run from this year until 2005 instead of 2000, as had been planned. Delta will still take delivery of some jetliners as early as this year, he said.

McDonnell Douglas declined to say how many orders the airline deferred. Don Hanson, spokesman for the planemaker, said Delta had 13 MD-88 narrow-body twin jets on firm order, and 50 MD-90s. The airline has taken another 120 options for the two airliners.

Delta also deferred some of its eight firm orders for McDonnell Douglas' three-engine MD-11 widebody airliners, though the planemaker expects Delta to take delivery of one MD-11 it has completed. The plane is sitting on the Tarmac at McDonnell Douglas' Long Beach, Calif., plant, already painted with Delta's colors, McDonnell Douglas said. Delta has placed another 29 optional orders for MD-11s.

The airline's orders with Airbus Industrie, for nine A310-300 twin-engine widebodies, are unaffected by the cuts.

Delta's announcement comes only a day after Boeing said order delays and cancellations will force it to cut 28,000 jobs, or 20 percent of its work force, over the next year and a half. McDonnell Douglas had earlier announced its own round of severe job cuts.

In January Boeing said that it expected sales in 1993 to fall about 14 percent because of the problems in the airline industry.